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CreditDonkey featured Pace University's Lubin School of Business's Paul Kurnit in "Where's the Best Place to Buy a Mattress?"
CreditDonkey featured Pace University's Lubin School of Business's Paul Kurnit in "Where's the Best Place to Buy a Mattress?"
CreditDonkey assembled a panel of industry experts to answer readers' most pressing questions. Here's what they said:
Paul Kurnit
Clinical Professor Marketing, Director, Lubin Pace Path at Pace University's Lubin School of Business
Should consumers rely on price to determine the quality of a product?
It depends! There is an old marketing adage, "Live by price, die by price." If similar products get into a price war, for a short time, consumers win. In the longer run, the product category can suffer or even go out of business.
Price is obviously an issue for consumers for consumables like groceries. Best in class products, i.e., Heinz Ketchup, can enjoy some price elasticity. Consumers are willing to pay more for what they think is truly best. But, store label brands that perform well at lower prices are popular, offer real savings, and even provide an ego boost to shoppers who believe they are savvy consumers.
It's a whole other game in the luxury market. Price premiums for premium goods—jewelry, fashion, travel—are expected and tolerated, even valued. Price is much less a factor than is consumer pride, performance, or pampering.
So, another adage is, "It's not what you pay for the goods or experience. It's the difference between what you paid and what you would have paid for an option at a lower price." Genuine article, known brand, or badge value can be priceless (or close to it). You wear the item with personal joy or remember the luxury vacation happily forever.
Price is very much a movable feast. The business proposition needs to extend price and value, not price alone. And product value is a function of performance AND perception.
